November 17, 2021
by Jonah R. Hecht

On November 16, Acting OCC Comptroller Hsu spoke to the Federal Reserve Bank of Philadelphia about “modernizing the financial regulatory perimeter,” and called for “comprehensive consolidated supervision” of certain cryptocurrency firms.  Comptroller Hsu stated that, since crypto firms are not currently subject to comprehensive supervision, “there are gaps in supervision, and risks can build out of the sight and reach of regulators.”  He said that “[w]ithout a consolidated, holding company supervisor—that is, an agency or group of agencies able to see the big picture and empowered to oversee all subsidiaries, including the unregulated ones—no one outside of the firm can understand how the firm as a whole operates and how much risk it is taking."  Hsu suggested starting to consider where the line for comprehensive, consolidated supervision should lie—and how such supervision can best be achieved—before there is a crisis.  He said the goal is not to stop business cycles, but to maintain trust.

Noting that no regulator can accomplish this alone, Hsu also called for regulatory agencies, including state regulators, to “learn to interact differently and define success differently. There needs to be less regulatory competition and more cooperation, less parochialism and more teamwork, less go-it-alone independence and more interdependence.”

Comptroller Hsu’s full remarks can be read at this link:  https://www.occ.gov/news-issuances/speeches/2021/pub-speech-2021-117.pdf 

Our summary of another recent speech by Comptroller Hsu can be found at: https://www.blockchainlawcenter.com/blog/blockchain-law-center/occs-hsu-calls-for-bank-like-regulation-of-fintech-companies-1123/

About Blockchain Law Center

Blockchain technology utilizes a distributed digital ledger to record and track information, and can be leveraged to gain transparency and certainty in transactions ranging from cryptocurrency to supply chain tracking.  This blog provides information on the legal developments surrounding implementation of blockchain technology, with an initial focus on the financial services sector.